No revisiting of exploration ban in govt resource strategy

The government’s draft 10-year strategy for minerals and petroleum emphasises the importance of gas for energy security and as a transition fuel to a low-emissions economy, but says the ban on exploration won’t be revisited.

The 42-page document, open for public feedback, is intended to help inform a review of the Crown Minerals Act. It does not set future policy but is intended to guide other policy makers and stakeholders and provide “certainty” to the industry and the public.

It will not revisit the government’s April 2018 decision to ban – imposed without prior consultation – the granting of new exploration permits everywhere but in onshore Taranaki.

“This is a key step towards transitioning to a low-emissions economy which is a key aim of this strategy,” the Ministry of Business, Innovation and Employment noted of the exploration ban.

About half the ministry’s document describes the country’s current reliance on minerals and hydrocarbons for everything from coal for steel making, the 7.6 million tonnes of rock and sand used in construction, and the gas used to make fertiliser and methanol, a key industrial chemical and one of the country’s biggest exports.

It also highlights the higher incomes the sector provides and the potential to develop clean-tech minerals - like lithium in the Taupo volcanic zone and nickel-cobalt in Nelson-Marlborough – which are increasingly being used in new renewable technologies.

“Aotearoa New Zealand’s future prosperity depends on a minerals and petroleum sector that can responsibly deliver the resources we need,” Energy and Resources Minister Megan Woods said in a foreword to the strategy.

“Along with transitioning to a carbon neutral economy by 2050, we are also intent on building a productive, sustainable and inclusive economy. This economy needs to deliver housing and infrastructure that is suitable and affordable for the growing number of New Zealanders.

“This built environment will only be realised if we can make sure an affordable and secure supply of resources such as aggregate and steel. We also need to ensure that we have the affordable, sustainable and secure energy to power this economy.”

Meridian Energy this week said the power sector is on the verge of a significant wave of new investment in renewable energy. That will require thousands of additional tonnes of concrete and steel just for three new wind farms nearing construction.

But chief executive Neal Barclay also noted the sector’s ongoing need for gas back-up beyond 2040. The firm also noted that wholesale power prices remain elevated because of ongoing concerns about gas supplies.

Greenpeace today dismissed the government’s strategy document as “utterly inadequate” saying it could allow oil and gas production to continue here for more than 50 years. It wants an immediate halt to exploration and a planned and “rapid” wind-down of this country’s oil, gas and coal sectors.

Modelling by the Intergovernmental Panel on Climate Change and the International Energy Agency shows that increased use of gas, nuclear energy and carbon capture and storage will be needed – alongside massive take-up of renewables – if the world is to meet its Paris climate commitments and meet rising energy demand.

Principles listed in MBIE’s strategy document say the Crown expects to receive a fair return for the minerals and petroleum it allows to be developed.

Industry participants and the Crown will be expected to act in ways supporting the transition to a carbon-neutral economy by 2050.

The environment must also be protected now and long-term, and the Crown and the industry should work toward a more circular economy through greater resource efficiency, recycling and re-use.

Ironically, given the exploration ban and Land Minister Eugenie Sage’s blocking of a land sale essential for the expansion of the Waihi gold mine, the government has committed itself to regulating mining and petroleum activities in ways that are "fair, transparent, reasonable and proportionate."

It has also committed to honour existing production and exploration permits and to make decisions based on the best evidence and accounting for the foreseeable need for minerals and petroleum for future generations.

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